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Trustee That Reinvested Trust Assets Through Its Insurance Affiliate Did Not Impermissibly Self Deal

August 2, 2013

Authors

Luke Lantta

Trustee That Reinvested Trust Assets Through Its Insurance Affiliate Did Not Impermissibly Self Deal

August 2, 2013

by: Luke Lantta

Corporate trustees have wrestled with investing trust assets in their own stock, their own proprietary mutual funds, or through their affiliates.  State trust laws take varied approaches to these practices as have the corporate trustees themselves.  Some options – where permitted by law – include refunding the entire commissions, reducing the commissions, offsetting the commissions by reducing the trustee fees, or taking the full commissions.  Needless to say, any approach may be met with hostility from the beneficiaries and claims of improper self-dealing.  In French v. Wachovia Bank, N.A., a federal appellate court has given us a watershed opinion on one of these approaches taken by a corporate trustee.

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Alcoholism And Incapacity

May 24, 2013

Authors

Luke Lantta

Alcoholism And Incapacity

May 24, 2013

by: Luke Lantta

A common theme of plaintiffs in lack of capacity cases is that some kind of cognitive impairment, such as dementia, chronic alcoholism, or major depression, by itself indicates that the grantor or testator lacked the requisite capacity to create a trust or will, respectively.  In Dorsey v. Ratz (link from Justia), a Maryland federal court recently looked at whether the diagnosis of major depressive disorder and alcohol dependence suggested incompetence when it came to executing a change of beneficiary form on a life insurance policy.

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Insurance Company Not Liable For Cutting Life Insurance Check To Wrong Trust

April 24, 2013

Authors

Luke Lantta

Insurance Company Not Liable For Cutting Life Insurance Check To Wrong Trust

April 24, 2013

by: Luke Lantta

Thomas and Michael Tessier allegedly bilked Frederick and Thaddeus Jakobiec and the estate of their mother, Beatrice Jacobiec, out of millions of dollars.  One part of that scheme allegedly involved the theft of approximately $100,000 in life insurance proceeds due a trust benefiting Thaddeus.   After Beatrice’s death, Thomas was rummaging through Beatrice’s items and found that a life insurance policy existed on the life of Beatrice.  That policy was payable to a trust known as the Smillie Trust.  So began this alleged criminal enterprise.

Thomas and Michael filed an ex parte petition to remove Frederick as trustee and install Michael as the trustee of the Smillie Trust for the benefit of Thaddeus.  Nearly simultaneously, Thomas fraudulently created a second trust for Thaddeus.  Through alleged fraud, forgery, and subterfuge, Thomas convinced the insurance company to pay the death benefit to the

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Decedent Failed To Change IRA Beneficiaries Through Will

December 12, 2011

Authors

Luke Lantta

Decedent Failed To Change IRA Beneficiaries Through Will

December 12, 2011

by: Luke Lantta

I’m guessing that most people don’t take the time to read the fine print on life insurance or IRA change of beneficiary forms.  And why should they, since it seems pretty self-explanatory: I once put my wife’s name in this box, now I want to put my kids’ names in that box.  The reason why you want to pay attention to that fine print is because – to be effective – that fine print usually has to be strictly complied with.

In Smith v. Marez, the North Carolina Court of Appeals, applying New York law, ruled that a decedent’s failure to strictly comply with the change of beneficiary form requirements for his IRAs meant that the IRA assets went to his wife and not his kids.

So what did Leonard George Smith do wrong?

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Daughter Forged Power of Attorney And Exercised Undue Influence Over Father

October 28, 2011

Authors

Luke Lantta

Daughter Forged Power of Attorney And Exercised Undue Influence Over Father

October 28, 2011

by: Luke Lantta

We’ll start and end the week here at BryanCaveFiduciaryLitigation.com with powers of attorney.  In order to abuse a power of attorney, there actually has to be one.   In Kubek v. Jones, the United States District Court for the Middle District of Alabama recently determined that a decedent’s daughter forged a power of attorney so she could convert her father’s retirement benefits and life insurance policy to the exclusion of her stepmother.  And, as if the forgery wasn’t enough, she also exercised undue influence over her father.

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